When selling a property in Costa Rica, a little forethought and pre-planning will help to make the process as smooth and efficient as possible. There are certain documents and information that we know the buyer´s lawyer will request during the due diligence process of any sale. To ensure a smooth transaction, it is advisable for the seller to have these documents ready even before entering into a Sales and Purchase Contract.
Below we are providing you with a list of documents that an organized Seller should ideally have ready even before receiving offers! Thank you to Invicta Legal for helping us with this very helpful list.
There are a lot of documents on the list, but not all of these will apply to your particular property. Being ready with these items will help ensure a smoother due diligence process and reduce the likelihood of delays once you go under contract.
PROPERTIES HELD IN A CORPORATION
(1) Original corporate books of the selling entity - if you hold the property in the name of a legal entity, it is important to make sure you have at hand the original legal books. A Sociedad Anonima (S.A.) will have 3 legal books - Shaeholders´Assemblies Book, Shareholders´Registry Book, and Board of Directors´Book). A Sociedad de Responsibilidad Limitada (S.R.L.) will have 2 legal books - Quotaholders´ Assemblies Book and Quotaholders´Registry Book. The Shareholders´ Registry Book or the Quotaholders´ Registry Book need to be up to date showing the current shareholders.
(2) Tax Obligations - The seller should be up to date with any applicable taxes - ie. annual personeria juridica tax
(3) Ultimate Beneficial Owners´ Registration - the seller must be up to date with the annual beneficiaries´declaration with the Central Bank of Costa Rica.
DOCUMENTS REQUIRED FOR ALL PROPERTIES - RAW LAND AND HOUSES
(4) Survey Plan - a copy of the property´s registered survey plan (registered at the Cadastral Registy AND assigned to the property at the National Registry).
(5) Up to Date Property Value Declaration filed at the Municipality - this declaration is required by law to be done every 5 years.
(6) Certificate from the Muni stating that the property is up to date with land taxes and municipal services.
(7) Land Use Certificate / Uso de Suelo - this document is applied for at the Muni by the seller or a Power of Attorney appoitned by the seller. The document will set out the allowed uses, coverage and setbacks that apply to the property.
(8) Water and Electricity Availability Letter - this is required if the property is not yet connected to these services, is vacant or for future development.
(9) Existence of Water Sources - disclose if there are any well, creek, spring or river on the property. These will have setbacks issued by the INVU.
PROPERTIES THAT HAVE CONSTRUCTION:
(10) Luxury Homes Tax - If applicable, the seller will need to provide documentation of the annual payments of luxury tax, valuation used to declare it and the declaration of the tax.
(11) Proof of Payment of Utilities and Public Services - Documents that reflect the payment of the last month of the public services provided to the property - such as water, electricity, cable TV, internet, etc.
(12) Rentals or Reservations on the property - Confirmation of future short-term rentals or reservations, or lack thereof. If the property is leased long-term, copy of lease agreement.
(13) Operating Permits - Copy of the operating permit from the Ministry of Health and the Municipal patente for any ongoing business being run from the property (including short term rentals).
(14) Inventory List - Complete list of all appliances, furniture and equipment included in the potential sale (photo inventory is an option); or a list of personal excluded items.
(15) Judicial / Administrative Claims - Indicate if the property is affected by any sort of judicial or administrative claims to the best of the Seller´s knowledge.
(16) Insurance Policy - Copy of any insurance policies on buildings.
(17) Employees - If you have employees working on the property, you should be aware that prior to the closing of a sale these employees would need to be duly liquidated in accordance with Costa Rican labor law.
(18) Construction Permit and Blueprints - a copy of the building permit and blueprints of existing constructions on the property
(19) Contracts - any contracts of any type that impost obligations over the assets should be disclosed - such as lease agreements, management agreements, etc.
PROPERTIES WITHIN A CONDOMINIUM:
(20) Homeowners´ Association Fees - certificate to be issued by the Condominium´s registered administrator acknowledging that the property is up to date with the HOA and/or Condominium fees of any kind. Provide details of the ordinary monthly fee, as well as if there is any extraordinary fee approved to date.
(21) Condominium´s Books and ByLaws - updated copies of the Condominium´s Books (with all previous Owners´Assemblies). Provide copies of the recorded bylaws (and any additional applicable rules) of the Condominium.
(22) Condominium´s Maps - a copy of the condo maps ("Laminas y/o Diseño de Sitio) duly approved by all the corresponding entities.
(23) Budget and Financial Statements - provide copies of the financial statements of the Condominium and the current year budget, as approved by the Administrator and/ or Homeowners´ Assembly.
(24) Insurance Policy - confirm if the common areas of the Condominium are duly insured. Provide a copy of policy.
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